Agents accept BA commission cut(1)

16 November 2000

UK travel agents have resigned themselves to a decision by British Airways to cut commissions from April 1 next year.

The seven percent commission that BA currently pays will be replaced with a ‘booking fee’ that will be a one-off fixed payment per booking.

Payments will vary depending on whether the tickets booked are for short-haul or long-haul travel with premium bookings attracting the biggest reward.

Agents will be left to sort out their service fees, which will have to be declared to customers. Dale Moss, BA director of sales, said it was a profound change in the way the airline did business but he believed it was the fairest system. “We want to strike partnerships with agents who want work for us,” he said.

The Association of British Travel Agents (ABTA) said the move would add another layer of confusion to the commission issue.

ABTA president Stephen Bath said his members provide BA with £10 million (US$14.2 million) worth of business every year. BA could no longer rely on agents to book its tickets when they could earn commission on rival airline’s tickets, he said. He floated the possibility of a booking fee being introduced into airline ticketing price structures.

Moss said ABTA was supportive of the new payment system although there had been a few critics.

'No place for agents who do not change'
Dale Moss, British Airways’ director of sales, said there was no place for agents who wanted to do things as they have always done.

“This new system presents agents with an opportunity to be very entrepreneurial.

“Corporate travel agents of the future will be very technologically savvy and will find sensitive ways of managing total travel costs.

“They’ll embrace electronic ticketing to cut costs and they’ll use technology to get a better profile of their customers and anticipate their needs.

“Agents will become a vested partner with the corporation and the airline if they manage the troika properly.”

Moss said that agents dealing with the leisure market also had great opportunities to succeed in the new environment.

“Consumers do not have time to plan holidays these days. Leisure agents should be profiling their clients and anticipating their needs three, four even five years ahead.

“They can plan and book holidays, and have an arrangement with a bank or investment company to provide the client with funds for early payment.”

He said travel agents “can have the future they want if they’re part of the rules committee.”

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